World Fuel Services In "A Good Position to Deal With This Emerging New Marine Industry"

WFS CEO Michael Kasbar: Credit - World Fuel Services

World Fuel Services Corporation (WFS) [NYSE:INT] last week reported a marine segment result that CEO Michael Kasbar explained was "again impacted by an industry which continues to bounce along the bottom of what remains a very challenging operating environment."

Still, Kasbar said there were signs that conditions are beginning to improve as we enter an "emerging new marine industry" that is being increasingly shaped by technology.

"You've got a world in transition, you've got industries in transition, we're in transition. The energy market is a wash. There's a heck of a lot of oil around," said Kasbar.

That said, there were "slightly positive indicators" for marine in both the container and dry bulk markets, he said, thanks in part to increased trade flow to China.

"But we will need to see a sustainable positive trajectory before acknowledging that the industry is coming out of what has been a multi-year stagnation," Kasbar warned.

"So the marine industry is challenged [but] it's critical - 90 percent of the world's goods transit. It's not going to go away and they're going to continue to use energy."

Kasbar said "a number of things" would be changed by the upcoming 0.50 percent global sulfur cap on marine fuel set to come into force in 2020.

"We're in the LNG, natural gas space. We're in the distillate space ... so I think we're in a good position to deal with this emerging new marine industry and it's just going to be different," he said.

"To think that we're going to have the rock 'n' roll days, I'm not sure if that's going to happen. Technology has just changed everything. We've got, really, an environment of post scarcity anarchy.

"There's just a supply of everything and the world is changing, and we're positioning ourselves really to be a technology company that just so happens to know a lot about fuel logistics, and that's really where we're going."

Last week WFS reported it sold 6.8 million metric tonnes (mt) of bunkers for the 1Q 2017 period.